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Monday, 6 May, 2002, 21:40 GMT 22:40 UK
Enron restructures to survive
Enron's Texas headquarters
Enron is going back to the basics of selling energy

The Enron that wowed North America during the 1990s has gone.

In its place is a trail of debts and a business that is trying to retreat from scandal and reinvent itself.

The company had been spectacularly successful at persuading investors that it had found a way of making huge amounts of money out of the reliable but dull business of supplying energy.

Enron was supposedly making its fortune through complex financial deals that allowed traders to fix prices for the sale of energy many years in the future.

Strong and viable

That part of the business has gone, taking with it billions of pounds of investors' money.

Thousands of workers have also lost their jobs.
Stephen Cooper, interim chief executive
New chief executive Stephen Cooper, brought in to rescue Enron

Enron is still based in Houston, Texas, but it has gone back to focusing on the old fashioned business of supplying energy to customers.

It has also been selling off parts of its business around the world.

The company says it is in the middle of restructuring "with the hope of emerging from bankruptcy as a strong and viable, albeit smaller, company".

The new firm intends to concentrate on energy infrastructure and focus on the transportation, distribution, generation and production of natural gas and electricity, primarily in North and South America.

But even though Enron may have sold its once-snazzy energy trading arm to Swiss investment bank UBS Warburg, the company still stands to make serious money from its old business.

Enron's trading desk was sold for $1 - and a share of profits during the next 10 years. Depending on how well UBS does at energy trading, Enron stands to gain anything between $40m and nearly $3bn.

Getting rich

Filing for Chapter 11 bankruptcy in the US has allowed Enron to reorganise while it is protected from its creditors.

Restructuring expert Stephen Cooper has been brought in as interim chief executive.

Jeff McMahon was appointed president and chief operating officer during the reorganisation but he has said he will leave on 1 June.

Part of the problem was that he was one of the executives accused of getting rich by selling shares when Enron was on the verge of collapse.

Prison sentences

Investigations into possible wrongdoing at Enron have been going on since last autumn.

The US stock market regulator and the Justice Department are currently looking for evidence of crimes such as fraud or insider dealing.

Such activities, if proven, could bring punishments ranging from fines to prison sentences.


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